Tuesday

26th Mar 2019

Opinion

Half of new EU aid money is being spent in Europe

  • Water storage devices on show at the 2016 AidEx event in Brussels. (Photo: Flickr)

The EU spends vast amounts on development aid, but new research shows that much of this money is being spent within Europe, calling into question the definition of aid and the transparency of EU spending channels.

In a world overwhelmed by humanitarian crises incurred by natural disasters and man-made catastrophes, there is an ever-increasing need for development aid globally.

Read and decide

Join EUobserver today

Support quality EU news

Get instant access to all articles — and 18 year's of archives. 30 days free trial.

... or join as a group

The EU continues to be the biggest donor bloc, with a rise of 27 percent over two years in total contributions to Official Development Assistance (ODA), to an overall figure of €75.46 billion.

Nevertheless, in CONCORD's AidWatch report 2017 - the biggest EU level study of its kind, involving all 28 member states - it is revealed that over half of new aid contributions since 2014 has been spent on activities within Europe, as opposed to the intended developing countries.

Since 2015, some 23 EU member states have increased their aid budget, but in 2016 the spending costs for migrants, refugees and security in donor countries increased by 43 percent; a figure deemed by CONCORD as 'inflated aid'.

At the same time, in 2015, aid to the poorest countries fell by 3.9 percent. This shows a rise in total aid spending, but only at the cost of the least developed countries (LDCs) receiving it. The ongoing refugee crisis in Europe is proving to have an unintended knock-on effect of diverging aid from where it is traditionally needed.

Humanitarian dilemma of 'non-traditional' aid spending

Around 1.5 million people claimed asylum in OECD countries in 2015 – the highest number ever recorded.

A 1988 DAC (Development Assistance Committee) rule allows donor countries to count certain refugee expenses as ODA for the first year after their arrival. ODA has played a crucial role in supporting the costs of providing refugees with temporary sustenance in LDCs, who host 86 percent of the world's refugees.

Austria, Germany, Greece and Italy for example, used 20 percent of ODA for refugee costs.

When there is a real need for countries to assist with high refugee influxes, is it really so unscrupulous that aid is being diverted to help states deal with the crises? From a human rights perspective, expenditure on refugees in their countries is commendable.

Hans Peter Teufers is the Director of International Humanitarian Supply Chain at the UPS Foundation, who will be speaking on how to increase aid effectiveness through transparency and accountability at AidEx 2017 next month.

He takes a pragmatic standpoint, sympathetic to countries using their aid budget to bear the burden of the refugee crisis.

Teufers said: "We haven't had a humanitarian crisis like this in sixty years. Italy, Spain and Greece, for instance, were the first resort for refugees – these nation's economies do not have an overflow budget."

Italy and Spain were two of the countries reported to have had the biggest increases in ODA in 2016, but largely due to refugee costs.

Teufers believes the solution is in "developing a new strategy by reconsidering the definition of development aid in line with political decisions and the global context, because even when we have committed to delivering a certain amount of development aid, it is a question of ability, not demand."

The OECD acknowledges that divergent practices across donor reporting grew most recently with large-scale refugee movements to Europe in 2015, and emphasises that "the ultimate goal should be to ensure quality aid for those who need it most" because "support for refugees in donor countries also contributes to global responsibility-sharing with countries in crisis and their neighbours in the developing world."

However, because the OECD makes up over two-thirds of external finance for LDCs, DAC chair Charlotte Petri Gornitzka asserted the need to "ensure that we also maintain financing of long-term development programmes, especially in the least developed nations".

Oxfam says that in principle aid budgets should be spent abroad to help lift the world's poorest people out of poverty, but "recognises that in the short term, providing a safe haven for refugees in the UK means additional costs at home".

In the longer term, Oxfam added, we should "start to move away from using overseas aid budgets on refugee resettlement costs, and instead look for alternative sources within our national budgets."

Spending solutions

Last week the OECD held its annual high level meeting in Paris, where participants discussed the effectiveness of the temporary working group (TWG) for refugees and migration that was established a year prior, in order to improve the consistency, comparability, transparency and accountability of reporting of ODA-eligible, in-donor refugee costs.

Over the past year, the working group has put together a pragmatic proposal and will issue a guidance for development donors working in contexts of forced displacement within the next few weeks.

The quality and quantity of aid can only be safeguarded if budgets and activities reflect the core purpose of aid, which is why the OECD's definition of ODA is an important benchmark.

However, aid and development data transparency organisation Publish What You Fund CEO Rupert Simons commented that discussions over definitions of genuine aid is unproductive, and believes more practical measurements are needed to assess where aid is spent.

Simons believes that the OECD needs better data on private sector bilateral aid donors.

He says: ""EU institutions generally perform well on transparency, but if they want to implement the progressive agenda of the EU Consensus on Development to achieve the 2030 Sustainable Development Goals (SDGs), they must start reporting on the money going through trust funds and the European Investment Bank with the same level of detail and frequency as the core development budget of the European Commission."

There is a consensus amongst organisations that aid must not be diluted or diverted away from poverty reduction in the least developed countries who need it, nor denied to humanitarian emergencies wherever they are.

But it is only by implementing effective management systems within robustly transparent and accountable institutions, that a results-agenda can encourage states to meet genuine aid spending targets.

Anastasia Kyriacou is the media officer for AidEx, the largest international humanitarian aid and development event. EUobserver is a media partner of AidEx 2017 in Brussels.

Macron wants asylum claims to start in Africa

The French president hosted a mini-summit with leaders from Chad, Libya and Niger, along with Germany, Italy and Spain. Among the proposals is a plan to set up safe zones in Niger and Chad to initiate asylum claims.

News in Brief

  1. EU tables plan for joint approach to 5G security
  2. MEPs agree to scrap summer time clock changes by 2021
  3. European Parliament votes on reform of copyright
  4. New French-German parliament meets for first time
  5. EU parliament reduces polling ahead of elections
  6. UK parliament votes to take control of Brexit process
  7. EU publishes no-deal Brexit contingency plans
  8. EU urges Israel and Gaza to re-establish calm

Italy should capitalise on Brexit

Now that the UK is leaving, Italy can, and should, step up. It is the third largest country and economy in the EU. Spain and Poland follow, but they are significantly smaller economically and population-wise.

The Magnitsky Act - and its name

It is disappointing that so many MEPs in the Socialist and Green group caved in to Russian interests, in fear of challenging a plutocratic regime, by saying 'no' to naming the Magnitsky legislation by its rightful name: Magnitsky.

Stakeholders' Highlights

  1. Nordic Council of MinistersNew campaign: spot, capture and share Traces of North
  2. Nordic Council of MinistersLeading Nordic candidates go head-to-head in EU election debate
  3. Nordic Council of MinistersNew Secretary General: Nordic co-operation must benefit everybody
  4. Platform for Peace and JusticeMEP Kati Piri: “Our red line on Turkey has been crossed”
  5. UNICEF2018 deadliest year yet for children in Syria as war enters 9th year
  6. Nordic Council of MinistersNordic commitment to driving global gender equality
  7. International Partnership for Human RightsMeet your defender: Rasul Jafarov leading human rights defender from Azerbaijan
  8. UNICEFUNICEF Hosts MEPs in Jordan Ahead of Brussels Conference on the Future of Syria
  9. Nordic Council of MinistersNordic talks on parental leave at the UN
  10. International Partnership for Human RightsTrial of Chechen prisoner of conscience and human rights activist Oyub Titiev continues.
  11. Nordic Council of MinistersNordic food policy inspires India to be a sustainable superpower
  12. Nordic Council of MinistersMilestone for Nordic-Baltic e-ID

Latest News

  1. EU lawmakers pass contentious copyright law
  2. France takes Chinese billions despite EU concerns
  3. Europe before the elections - heading back to the past?
  4. Romania presidency shatters EU line on Jerusalem
  5. The Spitzen process - a coup that was never accepted
  6. Russia and money laundering in Europe
  7. Italy takes China's new Silk Road to the heart of Europe
  8. What EU leaders agreed on climate - and what they mean

Stakeholders' Highlights

  1. Counter BalanceEU bank urged to free itself from fossil fuels and take climate leadership
  2. Intercultural Dialogue PlatformRoundtable: Muslim Heresy and the Politics of Human Rights, Dr. Matthew J. Nelson
  3. Platform for Peace and JusticeTurkey suffering from the lack of the rule of law
  4. UNESDASoft Drinks Europe welcomes Tim Brett as its new president
  5. Nordic Council of MinistersNordic ministers take the lead in combatting climate change
  6. Counter BalanceEuropean Parliament takes incoherent steps on climate in future EU investments
  7. International Partnership For Human RightsKyrgyz authorities have to immediately release human rights defender Azimjon Askarov
  8. Nordic Council of MinistersSeminar on disability and user involvement
  9. Nordic Council of MinistersInternational appetite for Nordic food policies
  10. Nordic Council of MinistersNew Nordic Innovation House in Hong Kong
  11. Nordic Council of MinistersNordic Region has chance to become world leader when it comes to start-ups
  12. Nordic Council of MinistersTheresa May: “We will not be turning our backs on the Nordic region”

Stakeholders' Highlights

  1. International Partnership for Human RightsOpen letter to Emmanuel Macron ahead of Uzbek president's visit
  2. International Partnership for Human RightsRaising key human rights concerns during visit of Turkmenistan's foreign minister
  3. Nordic Council of MinistersState of the Nordic Region presented in Brussels
  4. Nordic Council of MinistersThe vital bioeconomy. New issue of “Sustainable Growth the Nordic Way” out now
  5. Nordic Council of MinistersThe Nordic gender effect goes international
  6. Nordic Council of MinistersPaula Lehtomaki from Finland elected as the Council's first female Secretary General
  7. Nordic Council of MinistersNordic design sets the stage at COP24, running a competition for sustainable chairs
  8. Counter BalanceIn Kenya, a motorway funded by the European Investment Bank runs over roadside dwellers
  9. ACCACompany Law Package: Making the Best of Digital and Cross Border Mobility,
  10. International Partnership for Human RightsCivil Society Worried About Shortcomings in EU-Kyrgyzstan Human Rights Dialogue
  11. UNESDAThe European Soft Drinks Industry Supports over 1.7 Million Jobs
  12. Mission of China to the EUJointly Building Belt and Road Initiative Leads to a Better Future for All

Join EUobserver

Support quality EU news

Join us